RSS

Contact us

Monday 1 December 2008

The Spectator's Notes

Charles Moore's reflections on the week

John Howard, four times Prime Minister of Australia, is one of the great men of our time — direct, amusing, patriotic, moderate but tough-minded. He finally lost an election this year, which had the good effect of giving him some time in London recently. One of the Howard lessons is that when you get into office for the first time you must have a very nasty budget straightaway. Only at the start will you have the moral authority to tackle the vast public spending you have inherited. Mr Howard has been telling this to our own Conservatives. They know he is right, but they do not altogether like hearing it. Gordon Brown’s solution is to pretend that there is nothing seriously wrong with government spending, so if the Tories win next time the problem will be even bigger than it is today. What should be cut, and what other ways of raising revenue should be considered? Some cuts popular with those who know include regional development authorities, education maintenance allowances and the preposterous amounts spent on Scotland, Wales and Northern Ireland. Another problem is the vast spending on overseas aid. The Conservatives, unfortunately, are committed to it, for goody-goody reasons, but perhaps they could redirect it so that, contrary to the present law, it can be permitted to advance British interests. I would also throw in the windfall (see last week’s Notes) of abolishing the London Olympics. The biggest public sector problem is pay, which is probably best dealt with by breaking it down to departmental budgets, so that each has to decide whether to keep pay levels down or sack people. Then there is the possibility of spreading VAT to everything, including children’s shoes, newspapers and food, which would mean that the same revenue could be raised by dropping the rate from its current 17.5 per cent to 12.5 to 13 per cent. Alternatively, the tax could be kept only on existing items, but the rate pushed up to 20 per cent, imitating, less dramatically, what Geoffrey Howe did in 1979, when he all but doubled the rate. The Tories will not tell you much about this, for obvious reasons (note the hole in David Cameron’s speech on the economy this week), but theirs will be the worst public spending inheritance since 1979, so, if they want a second term, cuts there must be.

More articles from: Charles Moore | this section

Print this article  |  Email to a friend  |  Permalink  |   Comments (2)

Post this entry to:   del.icio.us | Digg | Newsvine | NowPublic | Reddit

Advertisement

Spectator Business | Apollo Magazine

Corporate | Advertising | Privacy | Terms

Spectator, 22 Old Queen Street, London, SW1H 9HP

All Articles and Content Copyright ©2008 by The Spectator | All Rights Reserved